Why Do Many Brands with a Large Market Share Spend

question 134

Multiple Choice

Why do many brands with a large market share spend proportionally less on advertising compared to brands with small market share?

• A)Beyond a certain volume of promotion, diminishing returns set in.
• B)There is no minimum level of exposure for advertising to have an effect on sales.
• C)Advertising will not stimulate economic growth for the industry.
• D)The firms with large market share do not understand the advertising-to-sales relationship.

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Definitions:

Social Group

A collection of individuals who interact with each other, share similar characteristics, and collectively have a sense of unity or identity.

Culture

The amassed beliefs, behaviors, knowledge, norms, language, values, and material objects that are passed down from generation to generation within a human group.

Animals

Animals are multicellular, eukaryotic organisms in the biological kingdom Animalia, characterized by their ability to move voluntarily, consume organic material, breathe oxygen, and reproduce sexually.

Humans

Biological beings belonging to the species Homo sapiens, characterized by their advanced cognitive abilities and complex social structures.